UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                             ----------------------



                                    FORM 10-Q

 (Mark One)
     x            QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

  For the quarterly period ended December 31, 1999

               TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

  For the transition period from __________ to __________

  Commission file number 000-23953


                              OMEGA WORLDWIDE, INC.
             (Exact name of registrant as specified in its charter)



          Maryland                                38-3382537
  (State of Incorporation)             (IRS Employer Identification No.)




                 900 Victors Way, Suite 345, Ann Arbor, MI 48108
                    (Address of principal executive offices)


                                 (734) 887-0300
                     (Telephone number, including area code)


     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant  was required to file such  reports) and (2) has been subject to such
filing requirements for the past 90 days.

   Yes        X        No
            -----         -----

     Indicate the number of shares  outstanding of each of the issuer's  classes
of common stock as of December 31, 1999

    Common Stock, $.10 par value                       12,276,000
           (Class)                                 (Number of shares)

<PAGE>

                              OMEGA WORLDWIDE, INC.

                                    FORM 10-Q

                                December 31, 1999

                                      INDEX
<TABLE>
<CAPTION>
                                                                                    Page No.
                                                                                    --------
PART I       Financial Information

Item 1.      Financial Statements:
             <S>                                                                       <C>

             Condensed Consolidated Balance Sheets
               December 31, 1999 (unaudited) and September 30, 1999 .............       2

             Condensed Consolidated Statements of Operations (unaudited) -
               Three-month periods ended December 31, 1999 and 1998 .............       3

             Condensed Consolidated Statements of Cash Flows (unaudited) -
               Three-month periods ended December 31, 1999 and 1998 .............       4

             Notes to Condensed Consolidated Financial Statements
               December 31, 1999 (unaudited) ....................................       5

Item 2.      Management's Discussion and Analysis of Financial Condition
               and Results of Operations ........................................      10

PART II      Other Information

Item 5.      Other Information ..................................................      12

Item 6.      Exhibits and Reports on Form 8-K ...................................      12

</TABLE>


<PAGE>

                        PART 1 - FINANCIAL INFORMATION

Item 1.    Financial Statements

                            OMEGA WORLDWIDE, INC.

                    CONDENSED CONSOLIDATED BALANCE SHEETS

                                (In Thousands)

<TABLE>
<CAPTION>
                                                                             December 31,         September 30,
                                                                                 1999                  1999
                                                                                 ----                  ----
                                                                             (Unaudited)            (See Note)
<S>                                                                              <C>                    <C>
                                    ASSETS
Current Assets:
  Cash and short-term investments ........................................    $   1,582              $  5,738
  Restricted cash ........................................................          389                   389
  Patient receivables ....................................................        7,840                     -
  Other current assets ...................................................        6,377                   915
                                                                                 ------                 -----
     Total Current Assets ................................................       16,188                 7,042

Plant, property and equipment, net
   of accumulated depreciation ...........................................       12,214                     -
Investments in and advances to Principal
   Healthcare Finance Limited ............................................       50,666                48,842
Investments in Principal Healthcare Finance Trust ........................        6,601                 6,619
Long-term rent receivables ...............................................        7,777                     -
Rent deposits ............................................................        4,076                     -
Other assets .............................................................        3,472                 5,909
                                                                                 ------                 -----
                                                                                 84,806                61,370
                                                                                 ------                ------
Total Assets .............................................................    $ 100,994              $ 68,412
                                                                              =========              ========

                     LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
  Short-term debt ........................................................    $  15,395              $      -
  Accounts payable and accrued expenses ..................................       13,772                 1,177
  Accrued income taxes ...................................................        2,979                 1,880
  Non-interest bearing deferred purchase obligation ......................            -                 1,215
                                                                                 ------                 -----
    Total Current Liabilities ............................................       32,146                 4,272
Long-term debt ...........................................................        3,476                     -
Other long-term liabilities ..............................................          485                     -
                                                                                 ------                 -----
  Total Liabilities ......................................................       36,107                 4,272
                                                                                 ------                 -----

Shareholders' Equity:
   Preferred Stock $1.00 par value:
     Authorized 10,000 shares
     Outstanding 260 Class B shares at liquidation value .................        2,600                 2,600
   Common stock $.10 par value
     Authorized 50,000 shares
     Outstanding 12,276 shares and 12,266
      at December 31, 1999 and September 30, 1999,
      respectively .......................................................        1,228                 1,227
   Additional paid-in capital ............................................       52,934                52,893
   Retained earnings .....................................................        8,315                 7,418
   Accumulated other comprehensive income ................................         (190)                    2
                                                                                 ------                 -----
     Total Shareholders' Equity ..........................................       64,887                64,140
                                                                                 ------                ------
Total Liabilities and Shareholders' Equity ...............................    $ 100,994              $ 68,412
                                                                              =========              ========
</TABLE>


Note - The balance  sheet at  September  30,  1999,  has been  derived from
       audited  consolidated  financial  statements at the that date but does
       not include all of the information and footnotes required by generally
       accepted accounting principles for complete financial statements.


               See notes to consolidated financial statements.


                                        2
<PAGE>

                              OMEGA WORLDWIDE, INC.

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

                                    Unaudited

                    (In Thousands, Except Per Share Amounts)



<TABLE>
<CAPTION>

                                                                                   Three Months Ended
                                                                                   ------------------
                                                                         December 31, 1999    December 31, 1998
                                                                         -----------------    -----------------
<S>                                                                              <C>                 <C>
Revenues:
   Patient services revenue .........................................         $ 24,594           $     -
   Fee income - Principal Healthcare Finance Limited ................            1,317             1,143
   Fee income - Principal Healthcare Finance Trust ..................              242                 -
   Interest Income:
     Principal Healthcare Finance Limited ...........................            1,201             1,089
     Short-term investments .........................................               51               226
   Rent income ......................................................                -             1,315
   Other income .....................................................              123               151
                                                                                ------            ------
                                                                                27,528             3,924
Expenses:
  Direct cost of patient services ...................................           25,448                 -
  Direct costs of asset management ..................................              605               657
  Allocated expenses from Omega Healthcare Investors, Inc. ..........              174               188
  Imputed and other interest ........................................              323               853
  Provision for depreciation ........................................               20               194
  General and administrative ........................................              388               365
                                                                                ------            ------
                                                                                26,958             2,257
                                                                                ------            ------
Earnings before equity earnings and taxes ...........................              560             1,667
Equity in earnings of Principal Healthcare Finance Limited ..........              336               223
Equity in earnings of Principal Healthcare Finance Trust ............              176                 -
Equity in earnings (loss) of Essex Healthcare Corporation ...........               75               (66)
                                                                                ------            -------
Earnings before income taxes ........................................            1,147             1,824
Provision for income taxes ..........................................             (250)             (533)
                                                                                ------            ------
Earnings before preferred stock dividends ...........................              897             1,291
Preferred stock dividends ...........................................              (52)              (52)
                                                                                ------            ------
Net earnings available to common shareholders .......................          $   845           $ 1,239
                                                                               =======           =======

Earnings per common share, basic ....................................          $  0.07           $  0.10
                                                                               =======           =======
Earnings per common share, diluted ..................................          $  0.07           $  0.10
                                                                               =======           =======
Average shares outstanding, basic ...................................           12,269            12,258
                                                                                ======            ======
Average shares outstanding, diluted .................................           12,270            12,258
                                                                                ======            ======
Total comprehensive income, net of taxes ............................          $   705           $   980
                                                                               =======           =======

</TABLE>

                See notes to consolidated financial statements.

                                 3

<PAGE>



                              OMEGA WORLDWIDE, INC.

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                    Unaudited

                                 (In Thousands)


<TABLE>
<CAPTION>

                                                                                      Three Months Ended
                                                                                      ------------------
                                                                              December 31, 1999   December 31, 1998
                                                                              -----------------   -----------------
<S>                                                                                 <C>                 <C>
Operating activities:
   Net earnings .............................................................    $   897             $ 1,291
   Adjustments to reconcile net earnings to cash
      provided by operating activities:
     Equity in earnings of Principal Healthcare Finance Limited .............       (336)               (223)
     Equity in earnings of Principal Healthcare Finance Trust ...............       (176)                  -
     Equity in (earnings) loss of Essex Healthcare Corporation ..............        (75)                 66
     Straight-line rent adjustment                                                   681                   -
     Depreciation and amortization ..........................................        534                 222
     Payments of federal and foreign taxes ..................................       (633)                  -
     Imputed interest .......................................................          -                 571
     Net change in operating assets and liabilities .........................    (14,392)             (1,141)
                                                                                 -------             -------
Net cash provided by (used in) operating activities .........................    (13,500)                786

Cash flows from financing activities:
   Proceeds from short-term borrowings ......................................     10,220              23,500
   Repayments of long-term borrowings .......................................       (394)                  -
   Proceeds from bank revolving credit facility .............................          -              34,502
   Other ....................................................................        (35)                 (9)
                                                                                 -------             -------
Net cash provided by financing activities ...................................      9,791              57,993

Cash flows from investing activities:
   Acquisition of real estate by subsidiary .................................          -             (49,288)
   Temporary advances to Principal Healthcare Finance Limited ...............     (1,488)            (17,341)
   Cash acquired in acquisition of Idun Health Care Limited
    net of cash consideration ...............................................        857                   -
   Investment in Tamaris, plc stock .........................................          -              (2,884)
   Dividends from affiliate .................................................        174                   -
   Other ....................................................................         10               1,063
                                                                                 -------             -------
Net cash used in investing activities .......................................       (447)            (68,450)
                                                                                 -------             -------
Decrease in cash and short-term investments .................................     (4,156)             (9,671)
Cash and short-term investments at beginning of period ......................      5,738              10,281
                                                                                 -------             -------
Cash and short-term investments at end of period ............................    $ 1,582            $    610
                                                                                 =======            ========

</TABLE>

                 See notes to consolidated financial statements.

                                        4
<PAGE>

                             OMEGA WORLDWIDE, INC.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                                    Unaudited

                                December 31, 1999

Note A - Organization and Significant Accounting Policies

ORGANIZATION

     On April 2, 1998, the registration statement of Omega Worldwide,  Inc. (the
"Company") became effective,  and it offered 3,750,000 shares of common stock to
the public at $7.50 per share. The Company received $27,375,000, net of issuance
costs of $750,000.  Shares offered included 500,000 shares in a primary offering
and  3,250,000  shares  in a  rights  offering.  Operations  commenced  upon the
effectiveness  of the initial public offering.  Additionally,  except for $1,000
invested by Omega Healthcare Investors,  Inc. ("Omega") at the date of formation
(November  1997) there were no cash flow activities of the Company from the date
of formation to the date operations commenced.

     Immediately  prior  to  the  offering  of  shares  by  the  Company,  Omega
contributed  substantially all of its investment in Principal Healthcare Finance
Limited ("Principal-UK") to the Company. Assets contributed by Omega, which were
recorded  by the Company at Omega's  accounting  basis,  included a  $23,805,000
subordinated  loan to Principal-UK,  33.375% of the common stock of Principal-UK
with a carrying  value of $5,297,000,  10,556,250  warrants and other net assets
totaling  $150,000.  Omega also assigned its interest in a management  agreement
with  Principal-UK  in which  the  Company  receives  an  annual  fee of 0.9% of
Principal-UK's  assets (as defined) for providing certain advisory services.  In
exchange,  Omega received 8,500,000 shares of common stock and 260,000 shares of
Class B preferred  stock.  Of the common stock received by Omega,  approximately
5,200,000  shares  were  distributed  pro  rata  to  Omega's  shareholders,  and
approximately  2,300,000  were  sold  pursuant  to  the  Company's  registration
statement. Omega retained approximately 9.9% of the Company's common stock.


BASIS OF PRESENTATION

     The accompanying  unaudited condensed consolidated financial statements for
the  Company  have  been  prepared  in  accordance  with  accounting  principles
generally  accepted in the United States for interim  financial  information and
with  the   instructions  to  Form  10-Q  and  Article  10  of  Regulation  S-X.
Accordingly,  they do not include all of the information and footnotes  required
by accounting  principles  generally  accepted in the United States for complete
financial statements. In the opinion of management,  all adjustments (consisting
of normal recurring accruals)  considered necessary for a fair presentation have
been included.  Operating results for the three-month  period ended December 31,
1999, are not necessarily indicative of the results that may be expected for the
year ending September 30, 2000. For further information,  refer to the financial
statements and footnotes  thereto in the Company's annual report Form 10-K/A for
the period ended September 30, 1999.


CONSOLIDATION AND SUBSIDIARIES

     The consolidated  financial  statements include the accounts of the Company
and its wholly owned subsidiaries after elimination of all material intercompany
accounts and transactions.  The Company's policy is to report the results of its
partially owned companies and subsidiaries on a one-month lag basis. This allows
time to produce  accounts in a local GAAP and then convert to a U.S. GAAP basis.
The Company's  wholly owned  subsidiary,  Idun,  began operations on November 1,
1999.  To reflect  activities  for a two-month  period and adopt  reporting on a
one-month  lag basis,  profit and loss results for November are included as well
as an estimated  loss from  operations for the month of December 31, 1999 in the
results for the quarter.

     Until April 1, 1999, the Company owned 100% of Principal-Australia. As more
fully  explained  in Form 8-K  dated  April 1,  1999,  newly  issued  shares  of
Principal-Australia  were  issued  to  independent  investors  resulting  in the
dilution of the  Company's  ownership  to 47%.  Principal-Australia's  financial
results on that date are  included in the  Company's  results on a  consolidated
basis prior to April 1, 1999,  and  thereafter are included in the results using
the equity method of accounting.

                                       5
<PAGE>

     The Company  reports the results of those  subsidiaries,  which it has over
20%  ownership,  but in which it does not hold a  majority  interest,  using the
equity method of accounting,  on a one-month lag basis. Investments in companies
over which the Company  does not  exercise  control are  recorded at fair market
value.  Temporary  changes in fair market value are charged to accumulated other
comprehensive  income,  while  permanent  reductions  in fair  market  value are
charged to operations.


STRAIGHT-LINE RENT EXPENSE

     Idun Health  Care  Limited  and its  subsidiaries  is the lessee of several
long-term leases.  Rent expense is recognized as the total rent payable over the
initial term of the related  lease  amortized  on a  straight-line  basis.  Such
expense includes the adjustment in the rental payments based upon  predetermined
minimum formulas as defined in the master lease.


Note B - Asset Concentrations

     Until April 1, 1999,  Principal-Australia  was reported on the consolidated
basis of accounting and 100% of the consolidated group's real estate investments
were owned by  Principal-Australia.  All of  Principal-Australia's  real  estate
investments are long-term care facilities located in Australia,  leased to Moran
Health Care Group  (Australia)  Pty Limited,  the largest  operator of aged care
homes in Australia.


Note C - Principal Healthcare Finance Limited (Principal-UK)

     The following summarizes selected financial  information of Principal-UK in
accordance with accounting  principals  generally  accepted in the United States
(in thousands):

<TABLE>
<CAPTION>

Selected Operating Results for the three-month period ended:    November 30, 1999    November 30, 1998
                                                                -----------------    -----------------
<S>                                                                      <C>                 <C>
Revenues:
      Rent income ...................................................  $ 14,836           $ 13,450
      Interest income ...............................................       118              1,526
      Other income ..................................................     1,341                 39
                                                                          -----               ----
            Total revenues ..........................................    16,295             15,015
Expenses:
      Interest expense ..............................................   (10,211)            (9,814)
      Depreciation and amortization .................................    (2,722)            (2,340)
      General and administrative ....................................    (1,558)            (1,286)
                                                                         ------             ------
           Total expenses ...........................................   (14,491)           (13,440)
                                                                        -------            -------
Income from operations before income taxes ..........................     1,804              1,575
Provision for income taxes ..........................................      (737)              (863)
                                                                           ----               ----
  Net income from operations ........................................   $ 1,067              $ 712
                                                                        =======              =====

Selected Balance Sheet Information as of:                       November 30, 1999    August 31, 1999
                                                                -----------------    ---------------
Investments in real estate subject to
  triple-net lease, net of depreciation ............................. $ 407,306          $ 395,533
Total assets ........................................................   589,180            569,666
Non-recourse debt borrowings ........................................   488,435            478,233
Total liabilities ...................................................   571,001            552,544
Total stockholders' equity ..........................................    18,179             17,122

</TABLE>

     The effective tax rates are 41% and 55% for the  three-month  period ending
November  30, 1999 and 1998,  respectively.  These rates  differ from the UK tax
rate primarily  because the provision for  depreciation  and amortization is not
deductible for tax purposes in the United Kingdom.  The Company's  proportionate
share of Principal-UK's  earnings for the three-month periods ended November 30,
1999  and  1998  are   approximately   $356,000   and   $238,200   respectively.
Additionally,   the  Company  had   recorded  a  charge   against   earnings  of
approximately $20,000 and $15,000 for the three-month periods ended November 30,
1999 and 1998, respectively, representing amortization over a ten-year period of
the excess of the Company's  investment in Principal-UK  over its  proportionate
share of Principal-UK's underlying equity.

                                       6
<PAGE>

Note D - Acquisition of Idun Health Care Limited ("Idun")

         At October 31, the Company,  through its wholly owned subsidiary,  Idun
Health Care ("Idun"),  acquired the operating  subsidiaries  of Tamaris,  plc, a
nursing  home  operating  company in the  United  Kingdom.  The 48  subsidiaries
acquired  operate 119 nursing homes  located  throughout  England,  Scotland and
Northern  Ireland.  The  fair  market  value of the net  assets,  at the date of
acquisition  was $9.5 million.  Fixed assets included in the $9.5 million amount
have been  written  down by $5.2  million  to  report  net  assets  equal to the
purchase price.

         Pro forma information for the Company, as if the Idun purchase had been
made as of October 1, 1998, is as follows:
<TABLE>
<CAPTION>

Pro forma operating results for the three month period ended:      December 31,        December 31,
                                                                       1999                1998
                                                                       ----                ----
<S>                                                                     <C>                 <C>
Revenues ........................................................ $   39,765         $   33,402
Net earnings available to common shareholders ...................        607              1,330
Earnings per common share, basic ................................       0.05               0.11
Earnings per common share, dilutive .............................       0.05               0.11
</TABLE>


Note E - Principal Healthcare Finance Trust (Principal-Australia)

     The  following  summarizes  selected  unaudited  financial  information  of
Principal-Australia   in  accordance  with  United  States  generally   accepted
accounting principles (in thousands):
<TABLE>
<CAPTION>

Selected Operating Results for the three-month period ended:       November 30, 1999
                                                                   -----------------

<S>                                                                       <C>
Revenues:
   Rent income .......................................................  $ 2,914
   Interest income ...................................................      155
   Other income ......................................................       11
                                                                           ----
       Total revenues ................................................    3,080
Expenses:
   Interest expense ..................................................   (1,947)
   Depreciation and amortization .....................................     (490)
   Amortization of  debt issue and organizational costs ..............      (79)
   General and administrative ........................................     (190)
                                                                           ----
       Total expenses ................................................   (2,706)
                                                                         ------
Income from operations ...............................................    $ 374
                                                                          =====
</TABLE>

<TABLE>
<CAPTION>

Selected Balance Sheet Information as of:                     November 30, 1999     August 31, 1999
                                                              -----------------     ---------------
<S>                                                                       <C>                <C>

Investments in real estate subject to
   triple-net lease, net of depreciation ............................. $ 92,834           $ 85,652
Total assets .........................................................  131,964             96,986
Non-recourse debt borrowings .........................................  105,287             75,815
Total liabilities ....................................................  117,234             82,215
Total unit holders' equity ...........................................   14,730             14,771


</TABLE>

     On April 1 Principal-Australia  sold 7,500,000 newly issued shares to Omega
and AMP Life Limited,  as well as 875,000  additional shares to the Company,  as
more fully  described  in the Form 8-K dated April 1, 1999.  Prior to this date,
the  Company  owned  100% of  Principal-Australia.  Issuance  of the new  shares
reduced the Company's ownership to 47% of shares outstanding.

                                       7
<PAGE>


Note F - Essex Healthcare Corporation

     On April 2, 1998,  Omega  contributed  to the Company  its  holdings in the
preferred stock of Essex  Healthcare  Corporation  ("Essex"),  an  Atlanta-based
private operator of skilled nursing  facilities.  The preferred stock was valued
at  approximately  $39,000.  Essex's  primary  activities are in Ohio,  where it
operates 13 long-term care and assisted living facilities  (approximately  1,400
beds).  It also  manages 33  facilities  (approximately  1,800 beds) in Indiana,
Michigan,  Illinois and Texas.  On July 30, 1998,  the Company  acquired  55,000
shares of Essex's  common stock for $500,000 and converted  its preferred  stock
into 1,940 shares of common stock.  The Company holds  approximately  47% of the
outstanding  common shares of Essex.  The Company  accounts for this  investment
using the equity method.

     The Company's  proportionate  share of Essex's earnings for the three-month
period  ended  November  30, 1999 is  approximately  $75,000  and  approximately
$66,000 of loss for the three-month period ended November 30, 1998.


Note G - Net Earnings Per Share

     Net earnings per share are computed based on the weighted average number of
common shares outstanding during the period.  Average shares outstanding for the
basic  earnings per share were  12,269,000 and 12,258,000 for the periods ending
December 31, 1999 and 1998,  respectively.  The assumed  conversion of shares of
preferred stock is antidilutive.


Note H - Credit Facilities

<TABLE>
<CAPTION>

The Company's indebtedness consists of the following:
                                                                              December 31,      September 30,
                                                                                  1999              1999
                                                                                  ----              ----
<S>                                                                            <C>                <C>
(1) Revolving credit agreement, (7.65% interest at December 31, 1999) ...  $ 11,825,000             $ -
(2) Loan, (8.00% interest at December 31, 1999) .........................     2,750,000               -
(3) Loan due February 2003, (7.86% interest at December 31, 1999) .......     1,994,000               -
(4) Loan due February 2017, (7.86% interest at December 31, 1999) .......     1,835,000               -
(5) Loan due April 2018, (5.00% interest at December 31, 1999) ..........       467,000               -
                                                                                -------             ---
                                                                             18,871,000               -
Less current maturities .................................................   (15,395,000)              -
                                                                            -----------             ---
                                                                            $ 3,476,000             $ -
                                                                            ===========             ===

</TABLE>

1)   In November 1998,  the Company  entered into a revolving  credit  agreement
     with a bank for  borrowings  up to $25 million since reduced to $20 million
     in January, 2000.  Omega provided a guarantee to the banks in consideration
     of a fee of 1%, plus an annual 25 basis point  facility  fee. The agreement
     is scheduled to expire on September 30, 2000.  The Company also pays to the
     banks an unused facility fee of 0.40%.  Borrowings  under the facility bear
     interest at LIBOR plus 1.350% or at the Company's option, at the prime rate

2)   Idun has a loan with a bank. The loan is secured by the business and assets
     of a nursing home subsidiary and carries an interest rate of 2.5% above the
     bank's base lending rate.

3)   Idun has a loan with a bank. The loan is secured by the business and assets
     of a nursing  home  company and carries a floating  interest  rate of Libor
     plus 2%. The loan is being  amortized over its life and requires  quarterly
     payments of approximately $178,000.

4)   Idun has a loan with a bank. The loan is secured by the business and assets
     of a nursing  home  company and carries a floating  interest  rate of Libor
     plus 2%. The loan is being  amortized over its life and requires  quarterly
     payments of approximately $60,000.

5)   At December 31,  1999,  Idun has an  unsecured  bank loan of  approximately
     $467,000. Interest rate on this loan is at a bank's base rate less .5%.

None of the loans of Idun are guaranteed by the Company.

                                       8
<PAGE>


Note I - Related Party Transactions

     Pursuant to the  provisions of a services  agreement  between Omega and the
Company,  indirect costs  incurred by Omega,  including  compensation  of shared
executive  officers and related support  personnel,  and costs incurred by Omega
for rent, insurance, telephone, utilities, supplies, maintenance and travel, are
allocated  to the  Company  based  upon the  relationship  of  assets  under the
Company's  management to the combined total of those assets and Omega's  assets.
Assets  and costs in the  formula  are on a  one-quarter  lag  basis.  Allocated
expenses during the  three-month  periods ending December 31, 1999 and 1998 were
approximately $174,000 and $188,000, respectively. Such allocations are based on
estimates and formulas that management believes to be reasonable.

     Temporary  unsecured  advances to Principal-UK in the amount of $19,856,000
and  $17,341,000  are  outstanding at December 31, 1999 and 1998,  respectively.
Interest on the temporary advances is 9.25%, paid monthly. Interest arising from
temporary  advances to  Principal-UK  is  included  in  interest  income for the
three-month  periods ended  December 31, 1999 and 1998 is $417,000 and $328,000,
respectively.

     A  subordinated  loan to  Principal-UK  in the  amount  of  $23,805,000  is
outstanding  at  December  31,  1999 and  1998,  respectively.  Interest  on the
subordinated  loan is 12.55% at December  31,  1999 and 12.18% at  December  31,
1998,  paid  semi-annually.  Interest  arising  from  the  subordinated  loan to
Principal-UK  included  in interest  income for the  three-month  periods  ended
December 31, 1999 and 1998 is $784,000 and $761,000, respectively.

     Fees from services  provided to Principal-UK  for the  three-month  periods
ended December 31, 1999 and 1998 are $1,317,000  and  $1,143,000,  respectively.
Fees from services provided to  Principal-Australia  for the three-month  period
ended December 31, 1999 are $242,000.

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<PAGE>


Item 2 - Management's Discussion and Analysis of Financial Condition and
         Results of Operations

     "Safe  Harbor"  Statement  Under  the  United  States  Private   Securities
Litigation  Reform  Act of  1995.  Statements  that  are  not  historical  facts
contained in Management's Discussion and Analysis are forward-looking statements
that involve risks and  uncertainties  that could cause actual results to differ
from projected  results.  Some of the factors that could cause actual results to
differ  materially  include:  the  financial  strength of the  operators  of the
facilities  owned by the  Company's  investees  as it affects  their  continuing
ability  to meet  their  obligations  under the  terms of the lease  agreements;
changes in operators or ownership of operators;  government  policy  relating to
the  healthcare  industry,   including  changes  in  the  reimbursement  levels;
operators'  continued  eligibility to  participate  in the government  sponsored
payment  programs;   changes  in  reimbursement  by  other  third-party  payors;
occupancy levels at the facilities;  the availability and cost of capital of the
Company and its investees;  the strength and financial  resources of competitors
of the Company and investees;  the ability of investees to make  additional real
estate  investments at attractive yields; and the ability of investees to obtain
debt and equity capital at reasonable costs.

     Following  is a  discussion  and  analysis  of the  Company's  consolidated
results of operations,  financial condition and liquidity and capital resources.
The  discussion  should be read in conjunction  with the unaudited  consolidated
financial statements and accompanying footnotes.


Results of Operations

     In prior years the Company generated income from three primary sources: (1)
fee income from  providing  investment  advisory and  management  services;  (2)
interest  income from  providing  financing to companies in the  healthcare  and
healthcare financing industries;  and (3) equity in earnings of companies in the
healthcare and healthcare financing industries.  In its most recent quarter, the
Company acquired and operated through Idun Health Care Ltd. ("Idun") 119 nursing
homes in the United Kingdom.  Company results for the quarter include two months
of operations since the date of acquisition.

     Prior to April 1, 1999  Principal-Australia  was reported on a consolidated
basis; currently, Principal-Australia,  now 47% owned, is reported on the equity
method.


Revenues

     Patient service revenue of $24.6 million represents two months nursing home
activity at an average  occupancy  rate of 88%. The results for the quarter were
unprofitable  and the Company is  directing  significant  resources to improving
occupancy and profitability over the coming months.

     Principal-UK fee income is earned from Principal-UK and Principal-Australia
based on assets (as defined) under  management.  Principal-UK fee income for the
three months ended December 31, 1999 was 15% higher than the  comparable  period
last year. Fee income from  Principal-Australia  was eliminated in consolidation
in the prior year.  Assets  under  management  at quarter end were $536  million
($490  million at  December  31,  1998) and $108  million for  Principal-UK  and
Principal-Australia, respectively.

     Interest income from  Principal-UK  has increased from prior years based on
increased temporary advances to fund, acquisitions by Principal-UK.  Rent income
in the period ending December 31, 1998 was earned by Principal-Australia.


Expenses

     Cost of patient services is incurred in running the Idun subsidiary's
nursing homes in the United Kingdom.  They exceed patient  service  revenues due
to wage pressures  and  seasonal  occupancy  reductions.  Minimum wage increases
and increased costs of temporary services and overtime have pushed costs up
faster than government-determined  fees. The Idun nursing homes were
unprofitable under previous management.  The Company expects to streamline
operations and improve management practices in the year ahead.

                                       10
<PAGE>

     Despite the increase in levels of assets managed,  the total of direct cost
of   investment   services   provided,   allocated   expenses  and  general  and
administrative  costs has  declined by $43,000 from the  comparable  period last
year due to spending controls in place. Principal-Australia incurred most of the
interest and  depreciation  expense in the prior year.  Interest  expense in the
current year arose from financing required to fund the operations of the nursing
home businesses acquired.


Other

     Equity in earnings of  Principal-UK  increased  from  $223,000 in the prior
year to $336,000 in the current  year.  The  Company's  ownership  percentage in
Principal-UK has remained constant at 33.375%.  The increase in income is due to
improved  performance of  Principal-UK as its leased assets and their rents have
increased.  Equity in earnings of  Principal-Australia  were relatively constant
during the period reflecting stable investment  levels,  fixed rental levels and
fixed long-term interest rates.

     The change in the Medicare payment  structure enacted last year resulted in
the  prior  year  loss  of  $66,000  for  Essex  Healthcare  Corporation.  Essex
management continues to make progress in structuring operations to be profitable
under this payment structure and in improving performance at the several skilled
nursing  facilities  that were acquired when they were  unprofitable.  Essex has
recorded profits in three most recent quarters, including a profit of $75,000 in
the most recent quarter.

     The Company's  effective tax rate varies from the federal statutory rate of
34% due to the benefit of available foreign tax credits.


Liquidity and Capital Resources

     During the quarter the Company  borrowed funds to pay  liabilities  assumed
with the purchase of the Idun  subsidiaries.  As of quarter end, the Company had
cash and short-term investments of $1.6 million and availability of $8.2 million
under the Company's bank revolving credit facility. These funds are in excess of
short-term  operating  requirements of the Company and are available for further
investments  or expansion of the Company's  operations  into other  geographical
areas.


Market Risk

     The  Company  is  exposed  to  various  market  risks.  Market  risk is the
potential loss arising from adverse changes in market interest rates and prices,
such as short-term  borrowing and foreign  currency  exchange rates. The Company
does not enter into  derivatives or other  financial  instruments for trading or
speculative purposes. The Company enters into forward foreign currency contracts
principally to hedge currency  fluctuations  in its  investments  denominated in
foreign  currencies,  thereby  limiting the Company's risk that would  otherwise
result from changes in exchange  rates.  At December  31, 1999,  the Company had
outstanding a ten-year  British pound sterling forward currency swap to exchange
(pound)20,000,000 for $31,740,000 to mature on October 15, 2007, and a five-year
Australian  dollar forward  currency swap to exchange A$11.0 million  Australian
dollars for $6,749,000 to mature on July 3, 2003. From time to time, the Company
may also obtain hedges for its foreign currency  exposure  relative to temporary
loans to Principal  and the Trust.  Because of the  Company's  foreign  exchange
contracts,  its sensitivity to foreign exchange  currency exposure is considered
low.

Year 2000 Implications

    The Company is not aware of any significant  adverse effects of year 2000 on
its systems and operations.

                                       11
<PAGE>




PART II -   OTHER INFORMATION

Item 5.  Other Information

         None

Item 6.  Exhibits and Reports on Form 8-K:

         (a) Exhibits - the following exhibits are filed herewith:

            Exhibit     Description
            -------     -----------

               27       Financial Data Schedule


         (b) Reports on Form 8-K:

         The following report on Form 8-K was filed since September 30, 1999:

          Current report on Form 8-K dated  November 12, 1999 with the following
             exhibits:

                Share Acquisition Agreement between Tamaris, plc and the Company

          Current report on Form 8-K/A filed January 11, 2000


                                       12
<PAGE>


                                   SIGNATURES

     Pursuant to the  requirements  of the Securities  Exchange Act of 1934, the
     registrant  has duly  caused  this report to be signed on its behalf by the
     undersigned hereunto duly authorized.

                              OMEGA WORLDWIDE, INC.
                                   Registrant

                                              By   /s/  ESSEL W. BAILEY, Jr.
                                              ------------------------------
                                                        Essel W. Bailey, Jr.
February 14, 2000                                       President and Chief
                                                         Executive Officer

                                             By   /s/  EDWARD C. NOBLE
                                             -------------------------------
                                                       Edward C. Noble
February 14, 2000                                      Chief Financial Officer



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